Lakes Oil seeking $9.3 million in 1¢ shares to prove a commercial oil or gas find in Latrobe Valley region

Hardy oil and gas explorer Lakes Oil had gone to its shareholders seeking $9.3 million from a non-renounceable rights issue priced at the princely sum of 1¢ a share, reported The Age (21/8/2007, p. 83).

PetroHunter unable to complete deal to earn a two-thirds interest: Given the uncertainty in equity markets, a sizeable shortfall to the issue was likely, but any shortfall could be held by directors for later placement at a price of at least 1¢ a share. Funds from the 1-for-3 issue were to be used in the group’s long-running hunt to prove a commercial oil or gas find in the onshore Gippsland Basin/Latrobe Valley region. The group’s program continued to be on a 100 per cent basis after US group PetroHunter was unable to complete a $US30 million ($A37.3 million) deal to earn a two-thirds interest.

Greenearth Energy working towards a float: The 1¢ issue price of the new shares compared with yesterday’s closing price of 1.2¢ a share for Lakes, up by 9 per cent. Yesterday’s interest partly reflected confirmation that geothermal aspirant Greenearth Energy was working towards a float. Lakes owned a third of Greenearth, which had been awarded three geothermal permits that partly overlapped Lakes’ petroleum permits. Lakes shareholders were to get a priority entitlement in the float. Lakes had never been backward in asking shareholders to fund its exploration efforts, as reflected in its swollen issued capital of 2.8 billion shares, with another 934 million to be added in the rights issue.